S&P Global Ratings has placed China Vanke's (HKG:2202, SHE:000002) B- long-term issuer credit ratings on CreditWatch with developing implications, citing its new management and how it will handle liquidity concerns.
Secured shareholder loans from Shenzhen Metro Group amounting to 7 million yuan provide some refinancing relief, but S&P deems them insufficient to tackle the property developer's liquidity problems fully.
The rating agency sees the company's credit profile improving if it receives timely and sufficient liquidity support, according to a Wednesday release.
Without this support, the company faces increasing liquidity challenges, especially with a projected net operating cash outflow in the first quarter of 2025 due to weakened contracted sales and payable settlements for this period, S&P said.
The CreditWatch resolution as well as future rating actions will depend on clarity regarding management strategies, including potential support from Shenzhen Metro Group, noncore asset disposals, and asset-pledged borrowings, the rating agency said.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.